Jeff Immelt, CEO of GE, headlined a conference in San Francisco today, announcing three major initiatives that GE is committing to, in order to advance their Ecomagination project. GE is planning to expand further into the clean tech world, and to drive innovation around the smart grid, energy efficiency, renewables, and electric vehicles.
Most significantly, GE and four major venture capital firms announced a $200 Million “Ecomagination Challenge” – an X-prize like contest to fund new startups with ideas on Renewables, Grid Efficiency and Eco Homes/Eco Buildings. Proposals from big thinking entrepreneurs will be taken until September 30, 2010.
As Immelt said, they want GE to continue to be an open technology company. They continue to innovate, but Immelt himself was the first to admit that it’s a clear advantage to cooperate with others. How to cooperate in the free market and yet benefit GE’s bottom line? One of the three major announcements made by Immelt this morning gets at this innovative ‘coopetition’ model GE is going to pursue.
Immelt started by rattling off the company’s recent performance in the clean tech sector, establishing the company firmly in the center of the growing sustainable economy. Over the last five years,
- GE has doubled research and development (R&D) expenditures in clean tech, to $5 Billion,
- Revenues from the Ecomagination brand grew 400%, from $5 B to $20 B over the same time period,
- The company lowered their own emissions 22%,
- and saved $130 M in energy, water, and other resource costs.
According to Immelt, this is just the beginning. “This is not about some soft initiative,” he said, “this is about real commerce and real customers.” As proof of his business-case-first approach, Immelt made a distinction between his passion for sustainability and some of the public sentiment that sustainability is more a philanthropic effort by letting everyone know that he spent the first 12 years of his GE career running their plastics division, driving sales of petrochemical products, hardly a “green” sector.
Ecomagination, as a program, has generated a lot of lessons for GE over last five years–
GE thought, “it costs too much”–They found, “it saves money.”
GE thought, “it’s about green”–They found, “it’s about industrialization.”
GE thought, “customers will hate this”–They found, “customers like saving money.”
GE thought, “this will be action by the elite”–They found, “this is about scale and creating jobs.”
GE thought, “we’ll be going it alone”–They found, “a system is required.”
Ecomagination’s goals for the next 5 years–
- double R&D to 10B,
- reduce GE’s energy intensity by 50%,
- reduce water by 25%,
- launch 30 new Ecomagination products in 2010 and 30 new products in 2011,
GE made three announcements today.
- The WattStation, an electric vehicle recharging pump: This is planned to be commercially available by the end of this year and should be widespread by 2013.
- The Nucleus, a smart meter of sorts for the home: the device will show people their energy use, making it obvious how people can save.
- The Ecomagination Challenge: They will be reviewing clean tech ideas submitted via Ecomagination.com, evaluating them as potential commercial relationships, as well as potential grant recipients from a $200Million fund.